Question 4 (a) The freezing cold spell at the beginning of 2010 increased demand for gas in the UK. Usage reached 454 cubic metres; the previous record was 449 metres set in January 2003. The National Grid which is responsible for energy in the UK issued several warnings in a matter of days that demand could outstrip supply and asked suppliers to increase the supply. (i) Illustrate the effect of the cold spell on the demand for gas using a demand curve diagram. (ii) Analyze two other factors that you think influence demand for gas. (iii) Do you think demand for gas is price elastic or price inelastic? Explain your reasoning. (b) Using a normal demand curve, explain how consumer surplus occurs. (c) Explain and illustrate with diagrams how and why a marginal cost curve maps out a supply curve.
Question 4
(a) The freezing cold spell at the beginning of 2010 increased
(i) Illustrate the effect of the cold spell on the demand for gas using a demand curve diagram.
(ii) Analyze two other factors that you think influence demand for gas.
(iii) Do you think demand for gas is
(b) Using a normal demand curve, explain how consumer surplus occurs. (c) Explain and illustrate with diagrams how and why a marginal cost curve maps out a supply curve.
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